The companies on the Global 500 employ 70.2 million people, and their revenue represents more than one-third of the world’s GDP.

Fortune Global 500

With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

Fortune 500

The corporations on our annual list of the world's 500 largest companies combined to generate $41.7 trillion in revenue over the past year.

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

The 300 companies on this year’s list brought in over $12.6 trillion in revenue for the latest 12 months, with the median revenue figure at $22 billion.

America's Most Innovative Companies

The corporations on our annual list posted aggregate revenues of $41 trillion for the second year in a row.

Industries included in the sector are airlines, transportation equipment, logistics, mail and freight delivery, railroads, shipping, and trucking.

Fortune Sector Leaders: Transportation

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

The corporations on our annual list of the world’s largest companies delivered a record $41 trillion in aggregate revenues.

The 300 companies on this list are transforming industries from the inside out.

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

F500-2023-089-American Airlines

The Fort Worth–based airline, one of the world’s largest carriers by passenger capacity, saw demand recover in 2022, following the COVID-19 pandemic slump. The company rose 25 spots in the Fortune 500. 
<ul> 
 	<li>Its revenue rose 64% to $49 billion in 2022, and the number of miles traveled by paying passengers rose 34%.</li> 
 	<li>The airline group cut over 1,000 flights in July and August of 2022 in an effort to curb disruptions and account for soaring costs and labor shortages.</li> 
 	<li>In early 2022, American Airlines partnered with Microsoft to set up access to cloud services and streamline ground operations.</li> 
 	<li>Just like its airline peers, American has an upbeat forecast for 2023 even as pilot and aircraft shortages hold back its capacity. The company plans to hire 2,000 new pilots in 2023 for its mainline operations, but has yet to agree on a new labor contract with its pilots.</li> 
</ul>

Aggregate sales hit $37.8 trillion last year—an increase of 19%, the highest annual growth rate in the list’s history.

This year’s Fortune 500 marks the 68th running of the list.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-174-American Airlines Group

Formed in 2013 by the merger of American Airlines and U.S. Airways, the company provides air transportation to 350 destinations in 50 countries. The largest carrier on the 500 list was hit hard by the COVID-19 pandemic in 2020. It lost $8.9 billion as its sales nosedived 62%, causing it to drop from No. 70 to No. 174 in the rankings this year. The new year didn't start much better as revenue declined 50% year-over-year in the first quarter of 2021 with a significant decrease in passenger flight sales but an increase in cargo flight revenue.

This year's Fortune Global 500 generated $33.3 trillion in revenues and $2.1 trillion in profits.

G500-2020-257-American-Airlines

American Airlines ceded its title as the leading airline in the U.S. to Delta, in an uneven year marked by labor disputes and the grounding of the Boeing 737 MAX planes. The latter caused the airline to cancel 10,000 flights in the fourth quarter alone. While the carrier's profits did rise 19%, to $1.7 billion, on $45.8 billion in revenues (up 2.8%), its hopes for a stronger showing in 2020 have since been scuttled by the coronavirus. After losing $2.2 billion in the first quarter alone and accepting government aid, American is shrinking its passenger fleet, the world’s largest. “Never before has our airline, or our industry, faced such a significant challenge,” CEO Doug Parker said in April.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-070-American-Airlines

American Airlines slipped two spots on 2019's Fortune 500 ranks, ceding its title as the leading airline in the U.S. to Delta, in an uneven year marked by labor disputes and the grounding of the Boeing 737 MAX planes. The latter caused the airline to cancel 10,000 flights in the fourth quarter alone. While the carrier's profits did rise 19%, to $1.7 billion, on $45.8 billion in revenues (up 2.8%), its hopes for a stronger showing in 2020 have since been scuttled by the coronavirus. After losing $2.2 billion in the first quarter alone and accepting government aid, American is shrinking its passenger fleet, the world’s largest. “Never before has our airline, or our industry, faced such a significant challenge,” CEO Doug Parker said in April.

This year's Fortune Global 500 generated $27.7 trillion in revenues and $1.5 trillion in profits.

This year's Fortune 500 marks the 65th running of the list.

This year's Fortune 500 marks the 64th running of the list.

This year's Fortune 500 marks the 63rd running of the list.

This year's Fortune Global 500 generated $27.6 trillion in revenues and $1.5 trillion in profits.

This year's Fortune 500 marks the 62nd running of the list.

The world's 500 largest companies generated $31.2 trillion in revenues and $1.7 trillion in profits in 2014. Together, this year's Fortune Global 500 employ 65 million people worldwide and are represented by 36 countries.

This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Global business is back. After limping through a worldwide financial crisis and economic slowdown, the 500 largest companies ranked by revenues shattered all sorts of performance records in 2013: They racked up combined revenues of $31.1 trillion, up 2.5% from 2012, and profits soared 27% to nearly $2 trillion. China’s 95 companies (up from 89 last year) posted $5.8 trillion in revenues. The U.S. has four fewer companies on the list than last year but remains (for now) the country leader, with 128 corporations on the list—including No. 1 Wal-Mart Stores—reporting $8.6 trillion in revenues. 

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

Sector

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One of the largest airlines in the world, American Airlines transports both passengers and cargo through major cities including Los Angeles, Madrid, and Tokyo. Tracing its origins back to 1926, the company formerly known as AMR Corp. assumed its present-day name in 2013 after announcing its merger with US Airways Group.

Q2 2026

Q1 2026

Q4 2025

Q3 2025

Q2 2025

Q1 2025

Q4 2024

American Airlines Group (AAL): Company Profile, Stock Price, News, Rankings

legacy

American Airlines Group

american airlines group

Thank you for standing by, and welcome to American Airlines Group's 4th Quarter and Full Year 2024 Earnings Conference Call. At this time, all participants are in a listen only mode. After the speaker presentation, there will be a question and answer session. I would now like to hand the call over to Scott Long, VP of Investor Relations and Corporate Development. Please go ahead.

Thank you, Latif. Good morning, and welcome to the American Airlines Group 4th quarter and full year 2024 earnings conference call. On the call with prepared remarks, we have our CEO, Robert Isom and our CFO, Devin May. In addition to our Vice Chair, Steve Johnson, we have a number of other senior executives in the room this morning for the Q and A session. Robert will start the call with an overview of our performance and Devin will follow with details on Q4 full year in addition to outlining our operating plans and outlook going forward.

After our prepared remarks, we will open the call for analyst questions followed by questions from the media. To get in as many questions as possible, please limit yourself to one question and one follow-up. Before we begin today, we must state that today's call contains forward looking statements, including statements concerning future revenues, costs, forecasts of capacity and fleet plans. These statements represent our predictions and expectations of future events, but numerous risks and uncertainties could cause actual results to differ from those projected. Information about some of these risks and uncertainties can be found in our earnings press release that was issued this morning as well as our Form 10 Q for the quarter ended September 30, 2024.

In addition, we'll be discussing certain non GAAP financial measures, which exclude the impact of unusual items. A reconciliation of those numbers to the GAAP financial measures is included in the earnings press release, which can be found in the Investor Relations section of our website. A webcast of this call will also be archived on our website. The information we are giving you on the call this morning is as of today's date, and we undertake no obligation to update the information subsequently. Thank you for your interest and for joining us this morning.

And with that, I'll turn the call over to our CEO, Robert Isom.

Thanks, Scott, and good morning, everyone. Earlier today, American reported a 4th quarter adjusted pre tax profit of $808,000,000 or an adjusted earnings per diluted share of $0.86 above the high end of the guidance we issued in early December. For the full year, we reported an adjusted pre tax profit of $1,800,000,000 or an adjusted earnings per diluted share of $1.96 I want to thank the American Airlines team for a great year and for their resiliency, continued hard work and dedication to delivering a safe and reliable operation for our customers. As I have said previously, at American, we're focused on delivering results. As we closed out 2024, we achieved a number of notable milestones.

With the ratification of a contract extension with our mechanics and fleet service team members in October, we now have multi year agreements in place with all of our largest work groups providing labor cost certainty through 2027. We delivered nearly $500,000,000 of value through our reengineering initiatives, nearly $100,000,000 more than expected. We announced a new 10 year agreement with Citi to become the exclusive issuer of the advantaged co branded credit card portfolio in the United States, which we expect will drive substantial incremental value to American over the life of the agreement, while unlocking even more value for Advantage members. We generated record free cash flow of $2,200,000,000 in 2024. And I'm excited to report that as of the end of 2024, we have reduced our total debt by more than $15,000,000,000 from peak levels in mid-twenty 21, achieving our initial debt reduction goal a full year ahead of schedule.

While there's still much work to do, these accomplishments are clear evidence that the American Airlines team is committed to delivering results and achieving our stated objectives. Now, on to our Q4 performance. Total revenue grew 4.6% on 2.5% higher capacity year over year. This resulted in our unit revenue inflecting positive in the quarter, up 2% year over year and above the high end of our December guidance. Passenger revenue strength throughout the Q4 was broad based.

In the Q4, American's year over year domestic, Atlantic, Pacific and total passenger unit revenue results led U. S. Network carriers. While Latin unit revenue was down on a year over year basis, we expect short haul Latin year over year unit revenue to be positive in the Q1. This strong performance is a result of the actions we have taken and we're encouraged by the trends we see early in the year.

Demand for American's product remains strong as evidenced by the continued strength of our business, premium and loyalty revenue performance. In the Q4, managed business revenue was up 8% year over year, a sequential improvement of 2 points versus last quarter, and we continue to see yield strength as we look ahead into the new year. Premium revenue increased approximately 8% year over year. Paid load factor in our premium cabins remains historically high and was up 3 points year over year with strength in both domestic and international. In the Q4, loyalty revenues were up approximately 14% year over year with Advantage members responsible for 75% of premium cabin revenue.

2024 was a record year for Advantage. Throughout the year, we had a record number of customers enroll in the program with members earning and burning more miles than any year in our history. Spending on our co branded credit cards was up 9.5% year over year in the 4th quarter, further highlighting the value of our loyalty program. American is proud to have an industry leading travel rewards program that is frequently acknowledged as providing the best value for its members. Finally, we remain committed to providing a leading customer experience, especially for our premium customers.

We're excited to introduce our new state of the art flagship suite on our new Boeing 787-nine and Airbus A321 XLR aircraft later this year. Over the course of the next 4 years, we expect to grow our long haul international capable fleet from approximately 125 aircraft today to nearly 200 aircraft in 2029. Additionally, American has led the way in introducing premium lounges and we're on track to open our 5th flagship lounge this summer in Philadelphia, which marks the 9th premium lounge across the system. In the Q4, we introduced boarding automation as a first step to improving the boarding process and customer feedback has been overwhelmingly positive. American was the 1st airline to offer streaming entertainment on our mainline fleet and we're proud to offer high speed Wi Fi on more aircraft than any other domestic airline.

In December, we began the installation of high speed satellite Wi Fi on our dual class regional aircraft. We expect the entire fleet will be retrofitted by the end of this year. Additionally, we're in the process of redesigning our mobile app, making it easier to navigate and to provide more self-service options for our customers. Building on these customer focused initiatives is one of our top priorities and we'll have more to share in the months ahead. Momentum in recovering revenue from indirect channels continued in the 4th quarter and we remain on track to fully restore our revenue share from indirect channels as we exit this year.

Our indirect flown revenue share improvement was driven by sequential gains in corporate revenue share, which has been the primary focus of our recovery efforts. Importantly, forward bookings continue to show strength into the Q1. As we enter the New Year, we're in position to continue recovering share in indirect channels. We've completed new contracts with all of our agency partners that serve our corporate customers and agreed to new agreements with the leisure agencies that serve our most profitable leisure customers. Additionally, we've reviewed and reworked agreements with our corporate customers most affected by the previous strategy and largely restored share of those travelers in our hub market.

Completing these steps provides a strong foundation for us to continue to compete for that business and restore our share in these important distribution channels and with those customers. Last year, we took steps to further grow and optimize Advantage. In December, we announced a 10 year agreement with Citi to become the exclusive issuer of the Advantage co branded credit card portfolio in the U. S. American has had a partnership with Citi for more than 37 years.

The strength of that partnership has enabled us to deliver 1st class products and customer service to millions of advantage card members and we're excited to continue to partner with Citi. Our 2024 cash from co branded credit cards and other partners was $6,100,000,000 an increase of 17% versus 2023. The 2024 amount includes a one time cash payment received in the 4th quarter related to our new credit card agreement. As we disclosed at the time of the announcement, we expect the agreement set to begin in 2026 will enable cash payments from our co branded credit card and other partners to grow by approximately 10% annually. As annual cash payments from co branded credit card and other partners approaches $10,000,000,000 we expect annual pre tax income will benefit by approximately $1,500,000,000 compared to 2024.

Our expanded partnership with Citi will unlock more value and provide exciting new benefits to our customers. With the agreement completed, the teams have turned toward building the business and we look forward to making several exciting announcements over the coming year. Turning now to our operation. Thanks to the resiliency of the American Airlines team, we delivered another quarter of strong results despite a difficult operating environment. Operational disruptions are part of the airline business and in American, we continue to show that operational resiliency and rapid recovery are part of our DNA.

In the Q4, American ranked 2nd in completion factor and on time departures among the 4 largest U. S. Carriers. For the year, we achieved our 2nd best completion factor since the merger carrying our largest ever volume of passengers. Looking ahead, continued investment in the operation and the technology that supports it will drive further improvements in our operating reliability and resiliency.

In closing, we've achieved a number of important objectives in 2024 and our performance in the Q4 shows what this team and what this airline are capable of. That foundation and the momentum we've built will serve us well in 2025. Before I turn the call over to Devin, I'd like to take a moment to acknowledge those impacted by the devastating wildfires in Southern California. Our hearts go out to those communities. Americans Advantage members and team members have donated more than $1,700,000 in funds to the American Red Cross to support relief efforts and we've donated supplies and care packages to families and firefighters in the Los Angeles area.

And with that, I'll turn it over to Devin to share more about our Q4 and full year financial results and our outlook for 2025.

Thank you, Robert. Excluding net special items, we reported a 4th quarter net income of $609,000,000 or adjusted earnings per diluted share of $0.86 We produced record 4th quarter revenue of $13,700,000,000 up 4.6% year over year with unit revenue up

4th quarter unit cost excluding fuel and net special items was up 5.7% year over year. Our adjusted EBITDAR margin was 14.9% and we produced an adjusted operating margin of 8.4%. In 2024, we achieved nearly $500,000,000 of savings from our reengineering the business initiative, exceeding our goal by nearly $100,000,000 Most of the value in 2024 was due to better workforce management driven by process improvements and technology implementation, along with improved asset utilization and procurement savings. We also had nearly $350,000,000 of working capital cash release, which exceeded our expectations and helped drive our 2024 free cash flow performance. We remain focused on running the airline as efficiently as possible while enhancing the customer experience.

Moving to our fleet. In 2024, we took delivery of 20 new aircraft and 10 used aircraft resulting in $1,900,000,000 of aircraft CapEx. Total CapEx for 2024 came in at $2,700,000,000 Looking ahead, we expect to take delivery of 40 to 50 new aircraft in 2025. Based on our current expectation for new deliveries, our 2025 aircraft CapEx, which also includes used aircraft purchases, spare engines and net PDPs is expected to be between $2,000,000,000 $2,500,000,000 and our total CapEx is expected to be between $3,000,000,000 $3,500,000,000 We continue to expect moderate levels of CapEx moving forward with aircraft CapEx averaging between $3,000,000,000 $3,500,000,000 for the remainder of the decade. We ended 2024 with $10,300,000,000 of total available liquidity and produced record free cash flow of $2,200,000,000 During the Q4, we prepaid $750,000,000 of near term debt maturities and strategically repriced 2 term loans.

We ended the year with total debt of $38,600,000,000 and net debt of $31,600,000,000 our lowest level of net debt since 2015. With these actions, we achieved our total debt reduction goal of $15,000,000,000 from peak levels in mid-twenty 21, a full year ahead of schedule. We are thrilled to have delivered on this commitment and we remain focused on continuing to strengthen our balance sheet as we work toward our stated credit rating goal of BB. Previously, we committed to reducing total debt to less than $35,000,000,000 by year end 2028. We are now committed to achieve that goal by the end of 2027.

Now on to the outlook for 2025. In the Q1, we expect capacity to be flat to down 2% year over year. This capacity is driven by lower capacity in the off peak months of January February, which combined are down approximately 3%, followed by growth of 3% to 4% in the peak travel period in March. We continue to expect full year capacity to be up low single digits, in line with expected economic growth and our prior guidance. Our growth in 2025 is focused on improving our schedule in markets that are not yet fully restored to historical levels, primarily in our northern hubs.

We expect our year over year capacity growth rates to be fairly balanced between domestic and international operations. We will remain flexible and we'll adjust capacity in response to demand and the competitive environment in which we operate. We expect 1st quarter revenue to be up 3% to 5%, and for the full year, we expect revenue growth of approximately 4.5% to 7.5% versus 2024. This is driven by continued indirect revenue recapture, strong demand for our product and a constructive industry backdrop with supply in line with expected demand. 1st quarter non fuel unit costs are expected to be up high single digits year over year.

This unit cost growth is driven by the reduction in year over year capacity, the mix of that capacity and the new collective bargaining agreements that were reached in the second half of twenty twenty four. In the Q1, regional ASMs will be up approximately 17% as we return to full utilization and mainline capacity will be down 2% to 3%. Based on the timing of our labor agreements and the shape of capacity, we expect unit cost to improve sequentially throughout the year from high single digits in the Q1 to low single digits as we exit the year. For the full year, we expect non fuel unit cost to be up mid single digits year over year with a large majority of the cost growth coming from higher salaries and benefits. As we look out to 2026, we have certainty in our labor costs and the rate pressure from our new collective bargaining agreements will ease.

We expect that in 2026, our year over year growth of our salaries and benefits per ASM will be well inside of inflation. We continue to focus on reengineering the business to become more efficient Through best in class workforce management, efficient asset utilization and procurement transformation, we expect more than $200,000,000 of incremental cost savings in 2025. Additionally, we are investing in a multi year transformation in our IT and tech ops organizations to modernize technology, improve operations and optimize staffing costs. We anticipate continuing to productively utilize our workforce with mainline full time employee counts staying approximately flat to 2024. This year, we also expect more than $100,000,000 in additional working capital improvements.

Based on our current demand assumptions and fuel price forecast, we expect a 1st quarter loss of approximately $0.20 to $0.40 per diluted share. For the full year, we are expecting to deliver adjusted earnings per diluted share of approximately $1.70 to $2.70 We expect another year of record free cash flow generation in 2025 and are currently forecasting more than $2,000,000,000 of free cash flow for the full year. Now, I'll turn it back to Robert for closing remarks.

Thanks, Devin. As we start 2025, the long term targets we outlined last March remain our focus, growing margins, generating sustainable free cash flow and continuing to strengthen our balance sheet. Our priorities for this year will continue the momentum we built in the back half of last year and further our progress toward achieving our long term targets. In 2025, we plan to operate with excellence and efficiently deliver a safe and reliable operation, take a fresh look at our product and service as we sharpen our focus on the customer experience, continue to strengthen our network both organically and through our airline partnerships. Our December announcement with Citi was an important milestone for American.

It will allow us to enhance advantage and further strengthen our leading travel rewards and co branded credit card program ecosystem. All of these priorities, including the restoration of our core sales and distribution initiatives will allow us to deliver on our revenue potential and we'll continue our work to reengineer the business as we build a more efficient airline. We know that by delivering on our commitments, we'll unlock significant value for our shareholders. Operator, please open the line for questions.

Good morning, everyone. Thanks so much for the time. So we don't know exactly what low single digit capacity growth means for the year, but if I just use 2%, that means RASM growth about 4 percent for the year versus the 5% getting in 1Q on your guidance. I understand capacity growth accelerates over the year, but can you talk about your assumptions on indirect revenue improvement and the industry outlook underlying that full year guide? And just really wondering like what could go better than your base case?

So Catherine, thanks. I'll start on our expectations for indirect revenue recovery and Devin can speak to capacity and Steve can add anything that he thinks is important as well. We're on track for recovering what we had lost. I feel really good about the progress we've made in a short 6 month period. And as we take a look and you can see from our notes, as we take a look at forward bookings, it really suggests that we've got traction in the marketplace.

So I have great confidence that we're going to recover fully as we move through the year. And then I'd just also note this that we also believe that from a revenue performance perspective, even outside of indirect channels, we think that we're poised to perform and outperform. You saw it in our Q4 results. And I can't speak to others' assumptions. But in an environment where the economy is improving, I think that we're going to improve faster than our largest competitors.

Yes. And I don't think there's any big moves in the quarterly capacity numbers. We guided the Q1, which will be down 0% to 2%. The remaining quarters will probably be all up in the neighborhood of 3% per quarter in terms of ASM capacity, which gets you about that midpoint on low single digit capacity for the year.

Catherine, this is Steve. I'll just follow-up with you asked about sources of potential upside from our base case. I'll just offer 3. First, I think that there's a decent chance that we could restore our sales and distribution restore sales and distribution revenue faster than Robert's by the end of 2025. I think that's an upside.

2nd, I would point you to both the Q3 and especially the Q4. Ultimately, we're going to be judged on everything and certainly revenue by our results. And I think the Q4 shows what we're capable of. And then finally, I'd just point to our agreement with Citi. The new agreement doesn't start until 2026.

And so the growth that we focus on from it won't start until then. But there is to get to that, there is a ramp up effort underway that I think could provide upside in our co brand revenue during the year.

That's great. Thanks for that additional color, Steve. Devin, maybe one more for you. As you've reached your medium term debt goal, can you speak to how you're thinking about capital allocation between now and that longer term goal in 2027? Understand you have more deleveraging to do to hit that 2027 goal.

And then you mentioned the BB credit rating. But what's the gating factor to consider shareholder returns? Thanks so much for all the time.

Thanks, Katie. Well, to start, we are really proud of achieving the $15,000,000,000 goal that we set out to do 2 or 3 years ago at this point, and we achieved it a year early. But our focus still remains on improving the balance sheet. We've set another near term goal here to have it total debt down another $4,000,000,000 to around $35,000,000,000 by 2027. So we'll focus on that.

We'll continue to focus on reinvesting in the business. And as we continue to improve free cash flow and improve the balance sheet, we'll come back and talk more about other capital allocation priorities.

Thank you. Our next question comes from the line of Connor Cunningham of Melius Research. Your question please Connor. The next question comes from the line of Connor Cunningham of Melius Research. Your line is open Connor.

Connor, please make sure your line isn't muted. And if you're on a speakerphone, lift your handset. Our next question comes from the line of Scott Group, Up Wolf Research. Your question please, Scott.

Hey, thanks. Good morning. So Devin, I think you laid out CASM going from high singles to start the year towards low singles ending the year. It doesn't seem like guidance implies a big deceleration in RASM throughout the year. So can you just talk about like how you see the progression of like price cost on like a net basis trending throughout the year?

Well, I'll just start by talking a little bit about our cost performance, because right now we are seeing some more pressure in the Q1 than we are during the rest of the year. So to start, we are really proud of our cost performance over the last several years. I'm excited about what the company is doing to reengineer the business and drive more efficiencies. I think we're making really nice investments in technology. The operations team is really leaning into this, and I think we're delivering a more efficient operation, a better operation for our customers.

In the Q1 though, we are seeing unit costs up high single digits. It's a handful of things. We have less capacity in the Q1 than we did a year ago. That starts to change as we grow capacity in the last three quarters of the year. We have a ton of regional capacity coming online.

As you know, that's higher cost capacity than the mainline capacity. It's actually driving average gauge to be down 4% to 5% in the Q1 year over year. Stage length is down as well. And then, of course, the labor agreements that were signed in the back half of last year weren't in our base for this year. So we see a lot of cost pressure in the Q1.

It eases throughout the year. We feel we're incredibly well positioned as we get into 2026, and we know we run the business as efficiently as anybody. On the margin side, I don't think there's any quarter that show outsized margin improvement year over year. We've guided EPS to midpoint of $2.20 So we are seeing nice EPS improvement year over year, but I don't think you're going to see any 1 quarter pop really materially versus what we performed versus how we performed in 2024.

Okay. And then can you just talk about maybe the progression of RASM throughout Q4 and then just regionally how you see RASM playing out in Q1 like transatlantic was up 12% in Q4. Can that sustain itself in the near term? Just any regional color. Thank you.

Thanks for that. I just point to the Q4 in which we had strong performance across the board. So Atlantic Pacific and then also domestic in terms of year over year improvement led our network competitors and overall we led it as well. As we take a look out into this year, I see continued strength domestically.

And the strong dollar is absolutely going to have an impact on buying and travel to Europe this summer. So we take a look to March. And as we look to some of our peak periods, spring break and getting into the summer, I see robust demand across the board. We've talked about premium traffic is being wind behind our sales and also something that I think that we're going to be able to do even better in. And Steve mentioned some of the things that are going to be additive as well in terms of potential for even better performance.

So overall, really confident about the year and like what we see and how we can operate in this environment.

Thank you. Our next question comes from the line of Jamie Baker of JPMorgan Securities. Your line is open, Jamie.

Hey, good morning, everybody. So an interesting statistic that United throughout yesterday was that the margin gap between its best and worst performing hubs had narrowed to, I guess, the lowest gap in, I think, it was 9 or 10 years. We've discussed Americans relative hub performance on these calls and in person for quite some time, but I never asked about the range. Would you be willing to comment on that margin range between your top and bottom hubs and whether it's improving or widening, obviously, a lot of moving pieces in many of your hubs at the moment? Thanks.

Okay. Thanks, Jamie. And I'll start, Devin and Steve can add in. Look, it's no secret that we've had to build back our network and we have a large portion of our network that is supported by our regional fleet. I feel great that in 2025, we're going to have our regional fleet fully deployed.

And what that's going to allow us to do is better fill out some of the hubs that they have quite frankly are ready and I think willing to support the network in a different way. But we've got to put the capacity there. So you're going to see the largest schedules that we've ever had in places like DFW in Charlotte, Miami in its peak will be bigger than it's ever been. DCA, which had been a laggard coming out of the pandemic, is now getting back to the performance levels that we had hoped. And we talked about some of the work that we're going to be doing in Chicago.

So across the board, we see performance improving. Some of the weaker points in our network as we take a look to the coast in New York and out in Los Angeles. And I'd say this that the schedule changes that we've made in LaGuardia, the largest schedule that we've run since the pandemic, I believe, just as we closed out the Q4, we're really seeing nice results in terms of where we put that capacity. And so from that perspective, I believe that we have improved considerably our New York performance. And I hope and have confidence that, that will be something that we can maintain going forward.

In Los Angeles, from that perspective, there are some capacity restrictions. But on that front, that's one where we really do partner well with our 1 world partner, Alaska Airlines and we look forward to continuing that progress. So, when you take a look at American, you've always known that DFW, Charlotte, DCA, and now DCA getting back into the ranks had performed well. Philadelphia is getting back to where it should be. Phoenix has historically been strong.

And then as I mentioned, we've got focus on the coasts in Chicago.

And then, while I have you, Robert, when I last saw you, which I think was in September, you mentioned you were spending half your time on efforts to reconcile with corporate accounts. And I think you said that publicly at a conference or 2. And I don't know if you actually meant precisely 50% or if that was just sort of metaphorical. But by the way you describe the effort in your prepared remarks makes it sound like most of that effort is behind you. Is that the right interpretation?

I guess, I'm just confused on exactly where American is on the reconciliation front and how managed corporate recovery trends from here. Thanks in advance.

Thanks, Jamie. Look, I will give a ton of credit to our commercial team, led by Steve Johnson for the enormous amount of work that had to be put in. And they absolutely enlisted me in that effort. And I will say, I don't know if it's 50% of the time, I spent a considerable amount of my time making sure that I was up to speed and talking to our corporate customers and agencies as well. That work is paying off.

It's foundational in that don't forget, these contracts are set up over a period of time. Revenue doesn't show up right away, but we're not resting on that. We're learning from certainly the issues associated with our past strategy. And that, I believe, bodes well for the future. So Steve, why don't you spend some time talking about progress and how you feel about where things are headed?

Sure, Jamie. And let me start by saying the team and I feel good about that. As Robert said in his opening remarks and again just a second ago, we're on track to achieve the commitment that he's made to fully recover our share by the end of 2025. As I said earlier, I think we can beat that. But it's not a linear process, and it's kind of event driven, if you know what I mean.

Q3 Robert's comments at Bernstein when he said that we were abandoning the old strategy. That had an impact on share. We the restoration of content into Edifact had an impact on share. The engagement with our partners in the Q3, what Robert was just talking about, but sometimes referred to around here as the apology tour, that had an impact on share. The Q4 was lots of work done in the Q4, but a little bit different and maybe that accounts for this the non acceleration that you might have been looking for over the course of the last 3 months.

But the Q4 task was actually infrastructure. It was making new agreements with all of our partners in the indirect community. It's an arduous task, kind of counterparty by counterparty. While it was going on, understandably, we were negotiating, so you didn't see a lot of share shift during that period of time. Indeed, some of our partners sent us either even stronger messages during those negotiations.

But it was ultimately successful, and we now have new agreements with 30 of the most important TMCs and agencies. And as Robert said earlier, we've modified the economics for all of our significant corporate customers who were impacted by our old strategy. And as we say and our partners say even more frequently, 3 airlines are better than 1. And those agreements create real incentives to move business to American. And indeed, the agreements with the TMCs and the agencies create real incentives to reestablish the share equilibrium that existed at the beginning of 2023.

So I expect those agreements are going to be big drivers of share shift in the 1st and second quarter. And so you'll see continued progress.

Thank you. Our next question comes from the line of Connor Cunningham of Melius Research. Please go ahead, Connor.

Someday, I'll figure out how to use the phone. Can you so I'm just trying to take all this. You sound like there's upside in indirect corporate share regains and then the loyalty stuff, as

as just like sequentially improving costs throughout the year. But your full year guidance at the low end suggests a decline year over year in earnings. And I'm just trying to understand that part a little bit better. It just seems like are you assuming that the main cabin doesn't get any better from here? It just seems really conservative just given what we've heard from you today and what we've heard from others so far.

Just trying to understand it a little bit better. Thank you.

Okay. Connor, I'll start. Devin can add in here. Look, again, we can only forecast based on what we know and what we see right now. We don't know what others are putting into their models.

We've told you that we think there's continued strength and that in terms of revenue performance, especially given the capacity that we're putting in, we see significant growth in our unit revenues. Now, if there is a better overall performance in the industry, as I said, I think that we'll continue to show outperformance because of the things that we've been doing. So that's my comment in terms of questions about how is your forecast versus what the assumptions others are making. Devin, anything you want to add?

Yes. I'd just say midpoint of our guide is 2.20 dollars That's up more than 10% versus what we did in 2024. There's obviously variability in earnings. We think the midpoint is what we seek to achieve. We'd like to do better than that.

But we put a range of outcomes because there is still some volatility that's there in things like fuel or some amount of economic risk at a macro level. But right now, we feel really good about the midpoint on the guide and it's nice year over year improvement and we hope to exceed that.

Okay. That's helpful. And then on the Citi contract or Citi, the renegotiation, I'm just trying to understand that a little bit better. So the economics change in 2026, but I think that there's a volume and spend related component in 2025. So can you just help bridge the contribution of how that will evolve, earnings contribution, how that evolves over that change from 2025 to 26?

It just seems again like there's this potential for it to surprise. So just thought there. Thank you.

Sure. Let me see if I understand the question. We well, in our existing agreement includes minimums for new accounts and new business that Barclays and Citi have committed to. Those we expect them to over perform on those as part of the ramp up into 2026. Is that helpful?

Thank you. Our next question comes from the line of Ravi Shanker of Morgan Stanley. Your question please, Ravi.

Great. Thanks. Good morning. Just want to start with a follow-up on the corporate normalization commentary. I think you said that you adjusted the economics for some of the biggest accounts there.

Can you just unpack that a little bit more? How does the profitability of the corporate business compare to where it was before now that like or once the share is normalized?

Sure. The adjustments we evolved our business with our corporate customers over the course of the last 7 or 8 months. We talked about this on the last earnings call. Some of this had to do with macro changes that we made like reestablishing what we call corporate experience, but a certain set of unique corporate experience advantages for our traveling corporate customers, employees, waivers and favors allowing travel agents to, in certain cases, book flights or change tickets that are not completely consistent with the general rules that apply. So some of that was, I think, very helpful.

But as part of the former strategy, we had created a kind of one size fits all discounting system for corporations that across the board for anyone who is impacted by that, that reduced discounts to, I think, an uncompetitive level. And so and that impacted about 24% of our corporate customers. Those were the ones that over the course of the strategy, their contracts came up and we were able to change them. So with respect to those customers, we've gone back, worked with them, negotiated with them and established economics that are more consistent with the past and more competitive. In all cases, those the revenue from those agreements, even with a little bit better discounting, is going to be very accretive.

Yes. And Steve, I think we've said this that when we talk about sales expense and bringing back sales team and potential impact on some of the things that we're doing, that overall cost impact is going to

a point of CASM. But again, all of this is going to be highly beneficial to the company.

American Airlines Group (AAL) Q4 2024 Earnings Call Transcript

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